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Revenue and profits fall at United

The consequences of an early exit from the Champions League are demonstrated by Manchester United's latest accounts which show a fall in revenue and profits for the year ended 30 June 2012.

Pre-tax profit for the 12 months to June 30 dropped by 16.5 per cent to £91.6m while total revenues dropped by just over 3 per cent to £320.3m. For the first time ever, however, commercial revenue at £117.6m exceeded matchday revenue at £98.7m and broadcast revenue at £104m.

Commercial revenue was up by 13.7 per cent, while broadcast revenue was down 11.3 per cent and matchday revenue 10.9 per cent. In the fourth quarter broadcast revenues dropped by 37.4 per cent as no Champions League participation revenue was earned. In addition, the club earned minimal revenues from the FA Cup following our fourth round exit, compared with reaching the semi-final in the previous year.

Manchester United's debt level was recorded at £436.9m on June 30 but it said the £68m raised through the sale of 10% of the club in August's flotation was being used to reduce this figure. Finance costs for the year fell 3.5 per cent to £49.5m.

This figure is more or less equivalent to the £49.6m used for net player spending. Signings pushed the figure up from £38.2m in the previous year. The first quarter which covers the summer transfer window purchases of Robin van Persie and Shinji Kagawa is expected to see net capital expenditure of £29m against £25m predicted in the flotation prospectus.

The club expects revenues this year to increase to £350m-£360m, assuming the club reaches the quarter finals of the Champions League and domestic cup competitions. They would hope to do even better.

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